United States

 Markets took comfort from reports that tariffs on Chinese goods could be phased down over five years, alongside confirmation that Federal Reserve Chair Jerome Powell’s position remains secure despite prior speculation. The easing of these key geopolitical and policy risks helped calm recent volatility, prompting a risk-on rally across asset classes.

The S&P 500 rose 1.7%, paring back earlier intraday gains of up to 3.4% but still closing firmly higher. The Nasdaq 100 surged 2.3%, buoyed by strength in technology names, while the Dow Jones Industrial Average added 1.1%. Despite the recent advance, the S&P 500 remains below levels seen at the start of April when the latest tariff headlines sparked sharp selling.

Earnings results helped reinforce positive sentiment. Boeing exceeded earnings estimates, Tesla shares jumped after Elon Musk pledged to step back from his government advisory roles to focus on running the company, and Texas Instruments provided an upbeat forecast. IBM also reported better-than-expected profits, further supporting the broader rally.

U.S. Treasury yields moved lower on the back of easing Fed concerns, with the 10-year note yield down two basis points to 4.38%. The greenback strengthened against major currencies, with the Bloomberg Dollar Spot Index up 0.6% as investors shifted back toward U.S. assets. Bitcoin rose 2.6%, benefiting from renewed appetite for risk, while traditional safe havens like gold fell.

Retail investors continued to buy aggressively into U.S. equities, injecting over US$30 billion into stocks and ETFs since the tariff headlines began, according to JPMorgan data. Meanwhile, margin requirements for equity futures positions have been increased sharply by CME Group amid heightened market swings, adding an additional layer of caution for institutional players.

Europe

European markets gained ground as fears over the stability of U.S. monetary policy leadership and the potential for escalating trade tensions eased. The Stoxx Europe 600 index closed up 2%, with Germany’s DAX outperforming regional peers, supported by software giant SAP’s strong earnings report. Mining and technology stocks led sector gains across the continent, while utilities underperformed.

Adding to the improved tone, reports surfaced that Russian President Vladimir Putin may be willing to halt military action along the current front lines in Ukraine, further lifting risk sentiment in the region. However, investor caution remains as economic data continues to show weakness across the eurozone.

Manufacturing activity in the euro area barely expanded in April, with the services sector sentiment hitting a near five-year low amid persistent trade-related uncertainty. Germany’s PMI unexpectedly declined for the first time in four months, underscoring the fragility of Europe’s largest economy. In the UK, the private sector contracted at its fastest pace in over two years, with S&P Global’s PMI dropping to 48.2.

Bond yields in Europe were mixed. Germany’s 10-year bund yield rose five basis points to 2.50%, while UK gilts were steady at 4.55%. Currency markets reflected a stronger U.S. dollar, with the euro falling 0.8% to US$1.1325 and the British pound down 0.5% to US$1.3264.

*Note: These prices are based on futures and/or CFD pricing and may therefore differ slightly from spot pricing.

Commodities

Oil prices fell as supply concerns eased and risk appetite returned to broader markets. West Texas Intermediate crude dropped 2.1% to US$62.31 per barrel, while Brent crude was down 2% at US$66.09. Traders interpreted recent signals from the Trump administration as reducing the likelihood of further shocks to global trade flows, weighing on energy prices.

Gold retreated sharply as safe-haven flows unwound amid the risk-on rally. Spot gold lost 2.6% to US$3,292.99 per ounce, pulling back from recent highs near US$3,500. Silver also edged lower, mirroring the weakness in precious metals.

Iron ore rose 1.7% to US$100.30 per tonne, underpinned by strength in mining equities and steady demand expectations. In the crypto space, Bitcoin jumped 3.4% to US$93,476, while Ether gained 5.3% to US$1,786.66.

The Japanese yen slid 1.3% to 143.43 per U.S. dollar after Treasury Secretary Scott Bessent ruled out pursuing exchange-rate targets in talks with Japan, reinforcing the dollar’s rally across G10 currencies.

Economic Calendar

• New Zealand: ANZ Consumer Confidence (Apr)

• United States:

  • Alphabet, Intel Q1 earnings results

  • Durable Goods (MoM Mar)

  • Initial Jobless Claims (Apr 19th)